Rail Vikas Nigam shares rise 4%. Here's why

Shares of Railway PSU firm Rail Vikas Nigam (RVNL) rallied 4% to Rs 69.6 in Friday's trade after the company received a letter of award from the Ministry of Railways for manufacturing and maintaining Vande Bharat train-sets.

“The company received a letter of agreement from the Ministry of Railways for the manufacturing and maintenance of Vande Bharat train-sets, including the upgrade of the government manufacturing units and train-set depots,” the company said in an exchange filing. The total quantity is 200 train-sets, with a cost per set of Rs 120 crore.

Earlier the Railway Ministry had announced that a consortium of Russia's CJSC Transmashholding and Indian PSU Rail Vikas Nigam was the lowest bidder for a Rs 58,000-crore contract.

At 1.30 pm, the scrip was trading 1.5% higher at Rs 68.1 over its last day's closing price of Rs 67 apiece. The stock has also surged over 108% in the last one year, while it has gained 18% in the last one month.

As per Trendlyne data, the average target price of the stock is Rs 61, which shows a downside of 10% from the current market prices. The consensus recommendation from two analysts for Rail Vikas Nigam is a strong buy.

Technically, RVNL is trading above six out of eight SMAs. The stock traded higher than the 5-day, 10-day, 20-day, 30-day, 150-day and 200-day moving averages but lower than the 50-day and 100-day moving average.

In Q3FY23, RVNL reported a 30.5% rise in consolidated net profit to Rs 382.42 crore from Rs 293.01 crore posted in Q3 FY22. Its revenue from operations declined marginally to Rs 5,012.09 crore in Q3 FY23 as against Rs 5,049.24 crore posted in the same quarter last year.

Total expenditure increased marginally to Rs 4,889.05 crore while other expenses spiked 16.04% to Rs 25.25 crore in Q3 FY23 over Q3 FY22.

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